Hurricanes usually include windstorm and flooding damage. This complicates things because windstorm losses are paid by private insurers while flooding is covered by the federal government through the National Flood Insurance Program (NFIP). If you live near the coast or on a floodplain, your mortgagee usually requires you to have flood insurance. You can buy flood insurance even if you’re not on a floodplain, but because it’s not required, most people opt out. Turns out that many of the people affected by Hurricane Harvey flooding do not have flood insurance.
We can look back on Hurricane Katrina for hints to how these situations play out. After Katrina, private insurance company adjusters were telling homeowners that their damage was caused by flooding, not by wind, and therefore not covered. Most people didn’t even realize they were not covered for floods.
What will hurricane flooding victims do? The feds do offer some assistance, mostly in the form of low-interest loans. This assistance needs to be approved by congress on a case-by-case basis.
Should we all just get flood insurance? Maybe flood insurance isn’t such a bad idea, even if you’re not on a floodplain. With climate change, storms will create more water, like the billions of gallons Harvey dumped on Texas. I just called my agent to find out about it for my 1,200 square foot house, which is not on a floodplain. For $250,000 coverage, which is the maximum, the cost is about $499 per year – it all depends on your level of risk and mine is low. The cost to insure a house on a floodplain could cost $800 or more. There’s a 30-day grace period so don’t wait till they announce a hurricane to get it.
A public adjuster can help guide you after a claim. Sometimes it’s hard to know what’s wind and what’s flood (the uncovered kind), so it’s good to have an expert on your side. And having just suffered the trauma of a hurricane, it’s pretty hard to deal with an insurance company, so let us help.
Robert L. McCormack Public Adjusters, Inc.